11,000 jobs at risk as BHS collapses into administration


High street retailer BHS has collapsed into administration, putting 11,000 jobs at risk and threatening the closure of up to 164 stores.

It is the biggest retail failure since Woolworths went bust in 2008.

Administrators Duff & Phelps said last-ditch talks to find a buyer for the firm over the weekend had failed, adding: "In addition, property sales have not materialised as expected in both number and value.

"Consequently, as a result of a lower-than-expected cash balance, the group is very unlikely to meet all contractual payments. 

"The directors therefore have no alternative but to put the group into administration to protect it for all creditors."

It added that BHS would continue to trade as usual while potential buyers are sought out. 

The company's owner, Dominic Chappell, said he will continue to work with the administrators to "find a solution post the administration".

He also said "no-one is to blame" for the collapse.

Speaking to the Press Association, Mr Chappell said: "No-one is to blame. It was a combination of bad trading and not being able to raise enough money from the property portfolio.

"In the end, we just couldn't reach an agreement with Arcadia over pensions."

BHS was bought last year by a consortium called Retail Acquisitions, headed by Mr Chappell, for £1 from retail entrepreneur Sir Philip Green, the owner of the Arcadia retail empire.

BHS has debts of more than £1.3 billion, including a pension fund deficit of £571 million, which proved a major stumbling block in the rescue talks.

Sir Philip is reported to have offered £80 million towards the cost of BHS pensions, though the regulator could still pursue further payment from the retail billionaire and has opened an official investigation into company's pension scheme liabilities.

The Pensions Regulator said: "We can confirm that we are undertaking an investigation into the BHS pensions scheme to determine whether it would be appropriate to use our anti-avoidance powers."

The shopworkers' trade union Usdaw has said that taxpayers should not be left to pick up the pensions bill.

John Hannett, Usdaw general secretary, said: "The Government needs to intervene now to protect taxpayers from picking up the bill for redundancy payments and safeguarding the Pension Protection Fund."

Rival retailer Sports Direct is understood to want to acquire some of BHS's 164 stores, but will only do so if it does not have to take on any pension liabilities.

It is thought that, along with Sports Direct, up to 30 other retailers may look to buy either a slimmed-down version of the business out of administration or pick over its store estate.

However, experts warned that it was "unlikely" a buyer for the business in its current form would be found.

Julie Palmer, partner at insolvency firm Begbies Traynor, said: "As an under-performing brand that simply hasn't kept up with the pace of change in the retail sector and requires major investment, it looks increasingly unlikely that any buyer will be brave enough to salvage the business in anything like its current form."

Business minister Anna Soubry is due to answer an urgent question on BHS in the Commons later on Monday.